Singapore moves to enhance investor protection in market misconduct cases

It involves establishing a grant scheme and making legislative amendments, amongst others.

The Monetary Authority of Singapore is seeking to enhance investors’ ability to seek civil compensation for losses suffered due to market misconduct.

The consultation paper, released on 24 October 2025, outlines three key proposals aimed at strengthening the current investment recourse regime, the central bank said.

The first, “facilitating self-organisation”, will see MAS introducing a mechanism that will allow an independent third party to be appointed as a designated representative to coordinate and bring legal action on behalf of affected investors.

The representative must satisfy specific criteria that include having no conflicts of interests and no direct financial interests to the outcome of the case.

The second will see the establishment of a grant scheme to co-fund “meritorious” investor actions and defray the costs of the designation representative in organising and coordinating investors. It will feature grant parameters, co-payment features, and a governance framework.

MAS is also seeking to reduce legal barriers to civil action by refining existing provisions in piggyback claims, or compensation claims that reference criminal conviction or civil penalty order made against wrongdoing.

This includes simplifying and clarifying the procedural steps by which investors may bring a piggyback claim; as well as extending the scope of the piggyback claim to default judgements, consent orders, or a civil penalty settlement a wrongdoer has entered with MAS.

MAS also proposes making legislative amendments to ease investors’ proof of reliance in case of misstatements or missions related to trading of capital markets products. The central bank noted that reliance may be difficult to establish on certain cases.

It also proposed removing existing statutory caps that limit compensation amounts, instead enabling the court to determine the amount based on the particular circumstances of each case.

The Equities Market Review Group has been announcing measures throughout 2025 aimed at increasing investor interest, improving Singapore’s ecosystem attractiveness to quality listings, and adopting a more pro-enterprise regulatory stance whilst strengthening investor confidence, MAS said.

Comments may be submitted until 31 December 2025 at the designated FormsSG link. The link, along with a copy of the consultation paper, are available at the MAS website.